Prices skyrocketed! Established coffee companies announce price increases!

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Recently, the sharp rise in global coffee bean prices has attracted the attention of the industry.

On Nov. 25, Arabica coffee futures rose 1.54% to $3.0995 per pound in New York, surging to $3.1280 on the day, the highest level since 1997. As of November 27, US type C coffee futures were trading at $3.2615 per pound, up 4.49 per cent from the previous session. Meanwhile, Robusta coffee futures rose 2.63% to $5116, driven by concerns about dry weather, after hitting $5327 earlier, a price that has reached its highest level since the 1970s.

It is understood that the price rise is mainly due to Brazil's worst drought in 70 years in August and September, followed by torrential rains in October. The continuation of the drought will directly affect the supply of coffee beans, thus pushing up prices in the global coffee market. In addition, port congestion and unrest in the Red Sea region disrupted the global supply chain, another factor contributing to the soaring price of coffee beans.

Coffee beans are expensive, and there has been a corresponding price increase in coffee products on the market.

Recently, Weizhisu AGF Co., Ltd. announced that from March 1 next year, a number of its coffee prices, including bar coffee, instant coffee, hanging ear coffee, capsule coffee and other conventional products, a total of 172. Starting from March 3, 2025, the brand will adjust the capacity of 17 bar coffees, which is expected to be reduced by about 10% to 12%. In addition, the price increase is expected to be 1530%.

It is reported that AGF is the coffee branch line of Weizhi, a famous Japanese food company. Founded in 1954, it is the second largest coffee brand in Japan, and its sales and reputation are second only to UCC. Thanks to the coffee production process of "T2 ACMI Roasting ®", AGF is one of the first coffee companies to develop and produce espresso, and is famous in the field of espresso. Weizhi AGF's main coffee brands are Blendy, Maxim, marim and so on, among which Blendy series products will be in the price range this time.

As for the reasons for the price increase, Weizhisu AGF said that the main reason is the exchange rate impact brought about by the depreciation of the yen and the high purchase prices of raw materials dominated by coffee beans, resulting in higher manufacturing costs, making it difficult for enterprises to fully absorb the impact of costs.

In fact, as early as this summer, the rise in coffee bean futures prices has gradually spread to the consumer side.

Starbucks South Korea, for example, announced a price adjustment for coffee in July. Starting from August 2, the prices of large (473 ml) and super-large (591 ml) drinks will rise by 300 won (US $0.22) and 600 won (US $0.44), respectively, while the prices of all medium drinks will remain unchanged. As for the reasons for the price increase, the company said at the time that "market factors have matured to push up the price of coffee, but as costs continue to soar, a price increase is inevitable."

In addition, US food and beverage giant Shengmei also said in June that it would raise the prices of some retail instant coffee products from this summer. Italian coffee maker Rabasa also said in an interview with the media that due to the soaring cost of raw materials, it was forced to raise prices and reduce profit margins; in order to reduce the pressure on profits caused by rising coffee bean costs, Nestl é issued a price increase plan last month.

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